Once a company has committed to moving forward with a Procurement Transformation Initiative as eluded to in the initial posting, Blog Series Part I - Procurement Transformation, and they have secured executive buy in, the next step is to begin setting the stage for the evaluation phase of the initiative. While executive sponsorship is a critical step in beginning to gain momentum towards the evaluation stage of the Procurement Transformation, it is not the only step in which sponsorship and support needs to be corralled. A team must be selected to lead the initiative. This team structure will vary depending on the scope of the initiative but should start with an executive lead that can act as a conduit between the stakeholder departments and the executive team. This lead role will select the team to conduct the evaluation, whether this is from an internal pool of resources or an external resource. The team that leads the evaluation will need to dedicate time and efforts to first developing a timeline for completing the evaluation within. This plan should take into account the overall Procurement Transformation timeline and focus on the broader objectives of the initiative. Rushing through even the planning and evaluation stages of the initiative will ultimately create gaps and lead to imprecision. In order to create the right paradigm for Strategic Sourcing and Procurement, the right steps must be taken with accuracy and sufficient attention.

While starting to develop the timeline for the initiative, the team will need to work closely with the executive team as well as all pertinent SS&P decision makers to define the goals and deliverables of the Procurement Transformation. This might be the most substantive and crucial step in the PT process. The entire premise is based upon alignment with corporate initiatives and strategic goals, in order to accomplish this broader goal the SS&P function must establish meaningful and measurable objectives that will lay the path for bigger alignment activities. This step is taking into consideration that there are already established companywide objectives that SS&P can tie into.

Once the objectives have been agreed upon the team can continue structuring a plan that will adhere to the timelines of those established goals. When creating the timeline the team will need to factor in departmental resources including and outside of SS&P. Naturally, all members of the SS&P function will be intimately involved in every stage of the initiative. On the other hand, collaborating departmental resources should not be discounted for the value they can bring by providing feedback on SS&P processes as they relate to their own activities and their interactions throughout the SS&P workflow. These departments may include Finance, Accounts Payable, Legal, IT, and Warehouse or Inventory Management functions. Resources should be selected based on their interaction level with SS&P and the relevance of those activities. The plan should allot for the appropriate amount of time to develop the questionnaire specific to each corresponding function. This questionnaire should be concise yet cover all of the points relevant to their role and interaction with SS&P. Prior to executing the questionnaire, criteria should be established around the responses and feedback ensuring that it aligns with expectations. Each departmental resource should be interviewed individually if possible in order to solicit the most honest and open feedback without concerns about being judged. Assess the feedback received to ensure it meets the criteria set forth so that nothing has been missed. Finally, the team should debrief on that function before moving on to the next. All of these steps in the evaluation should be factored into the timing and delivering of each milestone.

The planning stages will also include determining what aspects should be evaluated and subsequently sought for improvement. Typical areas include Processes, People, Technology, Reporting Metrics, and Continuous Improvement. This will vary with each organization but these are the building blocks of the SS&P function and as such should be the basis for the PTI. Again, deciding which elements to focus on will aid in the selection of appropriate resources to solicit feedback from. This is not an activity that should be approached from only the SS&P side of things, but as an organizational effort in improvement. In the next blog we will talk about the evaluation itself including the focus areas and process surrounding approach and execution.

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